Time to Buy Apache Corp (APA)?

09/05/2008 12:00 am EST

Focus: STOCKS

Apache Corp. (APA) is an exploration, development and production company of, natural gas, natural gas liquids, and crude oil and has been a darling of the energy analysts.

Apache Chart
Chart Key

We've followed Apache for a long time and have been impressed with its steady growth, earnings and longer-term, the tight trading range that usually settles on the 200 day moving average as its major support line. But in March, APA, along with crude oil, began to accelerate to a point that a correction was almost inevitable.

With APA at $130, the stock broke down from a somewhat imperfect head-and-shoulders reversal with a downside objective of $110.

Apache is just below the price objective of the breakdown, is several points above its long-term bullish support line, and has issued two buy signals from our internal proprietary indicator-the Collins Bollinger Reversal (CBR). Positions taken now could prove to be very rewarding.

By Sam Collins of OptionsZone.com

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